The Hong Kong government has announced it will provide diesel and liquefied petroleum gas (LPG) subsidies for public and commercial vehicles, amid higher fuel prices due to the ongoing Middle East war.

The diesel subsidy of HK$3 per litre will run for two months, from 12am on Thursday to 11.59pm on June 29, finance chief Paul Chan told reporters on Wednesday.

He said the subsidy, which will benefit public and commercial vehicles, as well as vessels that use diesel fuel, would be reflected in the listed price at petrol stations, and the government would reimburse the price difference to oil companies or distributors.

The government proposed the diesel subsidy scheme earlier in April, with an estimated expenditure of HK$1.8 billion, and the proposal was “swiftly approved” by the legislature, Chan said.

The finance minister also said the LPG subsidy of HK$0.5 per litre for taxis, minibuses and school buses would run for two months. The measure will benefit around 16,900 taxis, 3,440 minibuses and 170 school buses in the city.

Authorities plan to roll out the LPG subsidy in late May, he said, without saying exactly when.

See also: Hong Kong to see ‘shocks, volatility’ in oil supply amid Middle East war, leader John Lee says

Chan said that due to the ongoing Middle East conflict, the cap price for LPG at dedicated filling stations would rise by over HK$1 per litre – an increase of more than 28 per cent.

“Given that the majority of minibuses and taxis run on LPG, this will place significant pressure on their operations,” he said in Cantonese.

Transport minister Mabel Chan said at the Legislative Council on Wednesday that the LPG subsidy would cost the government around HK$38.4 million.

She said the expenses would be “reallocated internally” through three bureaus: the Financial Services and the Treasury Bureau, the Environment and Ecology Bureau, and the Transport and Logistics Bureau.

Tse Chin-wan, the environment and ecology minister, told the media at the legislature on Wednesday that the government would sign contracts with oil companies and conduct audits to prevent abuse of the subsidies.